Taking a strong stance on Israel's security, Netanyahu said that despite the close alliance with the USA and the American military aid, the main lesson from the 1967 war is that Israel ultimately can rely only on itself for its defense.

"For that reason, in any agreement, and even without an agreement, we will maintain security control over the entire territory west of the Jordan River", he said.

Relating to Israel's astounding victory, Netanyahu said that "the wonderful, defensive war that we endured, the most just and moral war, afforded us a wealth of achievements".

The statement, issued Monday, said the war "resulted in Israel's occupation of the West Bank, East Jerusalem, Gaza and the Syrian Golan and the displacement of hundreds of thousands of Palestinians and Syrians".

"We insist that the Palestinians finally recognise Israel as the national home of the Jewish people", Netanyahu said.

In April, the Palestinian Authority said it would no longer fund electricity that Israel supplies to the Gaza Strip and it has slashed the salaries of its 60,000 civil servants in Gaza - but not the West Bank - by 30 percent, offering no explanation other than a lack of foreign aid money.

There is a solid constituency for peace on both sides of the Green Line, both among Israelis and Palestinians.

In a statement - before Netanyahu's speech - marking yesterday's anniversary Palestinian President Mahmud Abbas's office reiterated his call for a Palestinian state with east Jerusalem as its capital.

"Now is the time to end the conflict by establishing an independent Palestinian state, living side by side in peace and security with the State of Israel".

The resolution called for a two-state solution to the conflict between Israel and its Palestinian neighbors and declared that "Israelis deserve security, recognition, and a normal life free from terror and incitement".

He did not specifically mention the two-state solution, long the focus of global efforts and US Middle East diplomacy.

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